I landed a job at wirecard in June 2020. The day before I was supposed to hand over my resignation, they filed for insolvency. Thank God that was a near miss
As always, well delivered content, thank you. As a German, I admit Bafin is a difficult word to pronounce: Bundesanstalt für Finanzdienstleistungen. One question: where did this faux account with $2.1bn come from? As a result from of the round tipping or, in general, as the debit account for faux revenue JE? You have a guestimate on that?
Thanks Andre. Generally the round tripping results in a wash, over time. So my guess is the escrow accounts is the debit to the fictitious revenue booking from those overseas partners.
@@ellenorbjornsdottir1166 literally Federal Institute/Office for Financial Services, but they call themselves the Federal Financial Supervisory Authority in English.
I’m new to your channel and love your videos, especially your presentation and explanation skills. It would be great if you can do a video on basic forensic accounting for individual investors who are analysing stocks. This will be quite useful as most investors don’t trust the auditors anymore due to the recent frauds and scandals. Thank you for this video!
Thanks ST. Yeah will do. A video on that. I highly recommend working for big 4 for a couple of years. My second option would be a couple of years at a smaller cpa firm.
@@TheFinancialController I have been researching on biggest scams like Enron etc.. and I see the big4 firms are there every where -- especially EY - Any particular reason? reputed firms are always in the spot.
@@time968 because they make more money in helping scam then what they make out of auditing their auditors secretly provide financial advices for cash which will never be acknowledged in public or else people wont trust audit ever if u do audit of big companies such high level scam can never go unobserved as long as auditors get good money in their pockets and company is going to be going concern for next fy they don't care
The Financial Controller I read that one thank you do you have any more ? it’s a great book that’s why investing in companies with conservative accounting policies is a must for me. How was Wirecard able able to record fcf ? It’s insane fcf is the hardest to fake but they did it !
Andre Behroozi hey yeah that’s the only book I have on the subject. There are many others good ones on amazon. Wirecard recorded revenue and claimed they “earned it” under revenue recognition rules. Meaning they fulfilled performance obligations, have rights to cash/AR, etc. it was the auditors responsibility to catch the it. That’s why in many audits that I’ve seen the auditor wants to trace every revenue dollar recorded to cash receipts. I wish the auditor did that in this case
The Financial Controller wow thanks for the insights just subscribed you clearly have superior knowledge on the subject. You have a good point! aggressive revenue recognition policies can lead to fcf appearing on the CD statement when it should not. it would be awesome if you did a video on lunkin coffee.
Great video. Isn’t true that these national big 4 firms are separate and distinct organizations from there counterpart firms in other countries? Therefore, if EY in Germany would be forced to break up, that would have little or no effect on EY in the US?
Thanks. That might be true, depending on the exact set up of the org chart. But I would suspect even if that's the case that the cultural impact of one locale break-up can lead to an org-wide split.
Do you think new rules will be put into place? I’ve been reading that some people want 2 different auditors to work on large clients. A big 4 auditor and a non big 4 auditor.
It’s an interesting idea. But not sure it’s practical. This could have been avoided if BaFin did their job and the auditor insisted on confirming bank balances independently
It worked remarkably well after the Wall Street crash of 1929 when regulations were introduced to avoid this happening again. Until the 1980s when deregulation removed the safety checks - and financial bubbles returned with alarming regularity
Excellent video. Thank you. As their external sales agent in Singapore building the merchant portfolio for them,, our investment of more than 5 years went up in smoke overnight when the Authority ordered them to stop providing merchant services in Singapore. Merchants were left scrambling. We lost everything. No compensation no support nor assistance. Big shame to put our trust on them.
You said the company is trying to find his way to continue but, realistically, which are the possible path to come back on track? Recapitalisation from government? Success in investigations, thus finding the lost money?
